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2 budget carriers take off from Dhaka within June

Competition set to intensify on ME routes

Sohel Parvez
Budget carriers Air Arabia and Bahrain Air are to start flights from Dhaka in a move that will intensify competition on the lucrative routes carrying workers to the Middle East region.
The entry of the low-cost carriers, analysts say, will help thousands of Bangladeshi workers go to the Middle East region at fares approximately $100 lower than that of the conventional carriers.
Air Arabia and Bahrain Air are expected to fix the launch date of the new services in the next two months.
Sales of agents of these low-cost carriers said they want to begin operation from the country’s main international airport Dhaka within June 2008 this year.
Local conventional carriers however expressed concerns over the entry of the low cost carriers saying that it would affect their business if passenger pressure were lower.
The low cost carriers got government approval to start operation from Dhaka following a recommendation from an inter-ministerial committee.
“It's a good start for the market. It will be very much beneficial for the Bangladeshi workers,” said an aviation analyst Imran Asif.
Asif also said entry of low cost carriers will be an eye opener for the local start flights from Dhaka within June.
airlines, who will have to improve competitive edges to retain their market share.
Air Arabia has already been operating from Shah Amanat Airport, Chittagong since June 18 last year.
On receipt pf the government endorsement, the carrier will now be able operate its flights on Dhaka-Sharjah-Dhaka route daily. Bahrain Air will operate on the Dhaka-Bahrain-Dhaka route.
Air Arabia will put Emirates, Etihad, Biman Bangladesh Airlines and GMG Airlines into competition, while Gulf Air will face competition from Bahrain Air.
“Our charges will be at least 20 percent lower than the conventional carriers'. We hope to start from Dhaka within
May,” said Shaheenuzzman Khan, general manager of Air Arabia's sales agent One World Aviation.
The official, however, said the airfare on the low cost carriers depends mainly on the supply and demand situation. The higher the demand for tickets, the higher the fares, he said, adding that the minimum charge on the Dhaka-Sharjah-Dhaka route is $376.
“But it may go up depending on the demand,” he said.
Operators said budget carriers can charge low fares due to the cut in various onboard services like food and beverage, restrictions on baggage weight, online booking system and non-refundable tickets.
According to travel agents, conven-tional carriers operating on the Dhaka-Dubai-Dhaka route charge between $772 and $592. UAE- based Emirates, the leader in Bangladesh aviation market, charges the highest, while local private GMG Airlines charges $592.
Abdul Kadir, chairman of Flight Link, GSA of Bahrain Air, said the carrier will take off flights from Dhaka within the next two months. He said the fare difference between Bahrain Air and Gulf Air will be at least $150.
"We are concerned at it. We will be affected much, if passenger pressure is low," said Ismail R Chowdhury, vice president of the country's biggest private carrier GMG Airlines.
According to the GMG official, the international carriers, such as Emirates, will not face any major competition, as they merely offer passengers connectingflights from Dubai.
"Dubai is the hub for these carriers providing connecting flights. But it's a destination for us. At the end, the local carriers will face competition," he said.
Hanif Zakaria, area manager of Emirates in Bangladesh, said their business would not be affected by low cost business because of air traffic growth in Bangladesh. "They (low cost carriers) will have a different market,” he said, adding that these carriers will help create new travellers.
Country's aviation industry is growing about 7.5 percent a year, encouraging a couple of local and international carriers to enter in the last one year. At present over 20 local and foreign airlines operate in Bangladesh.
sohel@thedailystar.net